Organizational resilience: how to thrive in the face of adversity - Emptor

Organizational resilience is defined as the ability of an organization to anticipate, prepare, respond, and adapt to sudden changes and disruptions in order to survive and, above all, thrive. Today, this capacity is key to remaining competitive in an increasingly volatile and uncertain market.

The VUCA Environment

The VUCA environment is characterized by volatility, uncertainty, complexity, and ambiguity. This concept was forged in the 1990s by American soldiers and is an acronym formed by the English terms:

• Volatility (V)
• Uncertainty (U)
• Complexity (C)
• Ambiguity (A)

According to recent studies, around 90% of companies suffer from this VUCA environment.

Volatility (V)

The V in VUCA refers to volatility, which is one of the main characteristics of the current environment. This volatility is manifested in the rapid change of economic, technological, social, and political conditions. These changes are becoming increasingly rapid and unpredictable, making decision-making difficult.

Uncertainty (U)

The U in VUCA refers to uncertainty, which is another of the main characteristics of the VUCA environment. Uncertainty is caused by lack of information and excess of information. In a constantly changing world, it is difficult to be sure of anything.

Complexity (C)

The C in VUCA refers to complexity, which is the third aspect of the VUCA environment. Complexity is caused by the interconnection of systems and globalization. In an increasingly interconnected world, organizations must deal with the complexity of systems.

Ambiguity (A)

The A in VUCA refers to ambiguity, which is the fourth aspect of the VUCA environment. Ambiguity is caused by lack of clarity and difficulty in interpreting information. In an increasingly complex world, it is difficult to know what each thing means.

The VUCA environment is a challenge for organizations, but also an opportunity. Organizations that know how to deal with volatility, uncertainty, complexity, and ambiguity will have a competitive advantage. VUCA leaders are able to make quick and effective decisions in a constantly changing world. If your organization is looking to improve its competitiveness, the VUCA environment can be an opportunity to do so.

Facing the Challenges of 2022

Economic signals rarely point in one direction, but this is an unusually chaotic period. And it’s producing the most complex operating environment on record for chief executives and other leaders.

Consider how we got here. The COVID-19 pandemic introduced sudden and nearly unprecedented changes to the global economy: lockdowns, nearly empty trains and office buildings, stagnant economies, negative oil prices, dizzying growth in e-commerce, and more.

Then, just as COVID-19 was becoming endemic, Russia invaded Ukraine, delivering another blow to the global economy. The ripple effects of the war are still being felt in the United States and elsewhere. Inflation has soared: in June 2022, the consumer price index rose 9.1% (year-over-year); inflation in Mexico, as measured by the National Consumer Price Index, accelerated for the second consecutive month to 8.15% in July, reported INEGI, and the producer price index rose more than 11%.

Food price inflation may be the most worrying effect: the United Nations estimates that global food prices have increased by 50%. That has troubling implications for poor and vulnerable populations in the United States and elsewhere.

Organizational Resilience: Transform or Fall Behind

Organizational resilience is influenced by a series of factors, from organizational culture to the ability to make quick and effective decisions. Another important factor is flexibility, as a more agile and adaptable organization will have a greater capacity to overcome adversity.

To improve organizational resilience, it is important to identify weaknesses and work on them. It is necessary to foster a culture of resilience, which includes continuous learning and the ability to make quick and effective decisions. It is also important to provide the organization with the necessary resources to face the challenges, and to establish effective communication channels to keep all members of the organization informed and aligned.

If you do this, you can significantly improve the resilience of your company and be better prepared to face the challenges of the future.

High-Performing Companies: A Challenge in 2022

High-performing companies were successful during the pandemic because they spent more time establishing business model resilience, organizational resilience, operational resilience, and digital resilience. They clarified their goals and established a strategy that allowed them to continue operating despite the difficulties. They spent more time training and recognizing employees, made schedules and roles more flexible, and invested in collaboration technologies. These actions allowed them to be more resilient and thrive in a difficult time.

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